Accounting_1

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Author:
DSWare
ID:
218791
Filename:
Accounting_1
Updated:
2013-05-09 13:18:34
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Accounting
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Description:
Accounting Chapt 1 Basics and Debits and Credits
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  1. The financial statement that reports the revenues and expenses for a period of time such as a year or a month is the
     income statement  
  2. The financial statement that reports the assets, liabilities, and stockholders' (owner's) equity at a specific date is the
    balance sheet    
  3. Under the accrual basis of accounting, revenues are reported in the accounting period when the
    service or goods have been delivered
  4. Under the accrual basis of accounting, expenses are reported in the accounting period when the
    expense matches the revenues or is used up
  5. Revenues minus expenses equals _______  ________________.
    Net Income
  6. Assets are usually reported on the balance sheet at which amount?
    cost 
  7. Obligations (amounts owed) are reported on the balance sheet and are referred to as ________________.
    liabilities
  8. Liabilities often have the word ________________ in their account title.
    payable
  9. Unearned Revenues is what type of account?
    Liability
  10. Which term is associated with "left" or "left-side"?
    Debit
  11. Which term is associated with "right" or "right-side"?
    Credit
  12. When cash is received, the account Cash will be
    Debited
  13. When a company pays a bill, the account Cash will be
    Credited
  14. What will usually cause an asset account to increase?
    Debit
  15. What will usually cause the liability account Accounts Payable to increase?
    Credit
  16. Entries to expenses such as Rent Expense are usually
    Debits
  17. Entries to revenues accounts such as Service Revenues are usually
    Credits
  18. A company receives $500 of cash as an additional investment in the company by its owner, Mary Smith.  The company's Cash account is increased and Mary Smith, Capital is increased.Should the $500 entry to the Cash account be a debit?
    Yes
  19. A company receives $500 of cash as an additional investment in the company by its owner, Mary Smith.  The company's Cash account is increased and Mary Smith, Capital is increased. Should the $500 entry to Mary Smith, Capital be a debit?
    No
  20. A company performed services on account in August.  The services were for $2,000 and the company gave the customer credit terms that state the amount is to be paid to the company in September

    Assuming that the company prepares monthly income statements, what will be the account debited for $2,000 in August?
    Accounts Receivable
  21. A company performed services on account in August.  The services were for $2,000 and the company gave the customer credit terms that state the amount is to be paid to the company in September.

    Which account should the company credit for $2,000 in August?
    Service Revenue
  22. A company performed services on account in August.  The services were for $2,000 and the company gave the customer credit terms that state the amount is to be paid to the company in September.

    In September when the company receives the $2,000 from the customer, which account should the company debit?
    Cash
  23. A company performed services on account in August.  The services were for $2,000 and the company gave the customer credit terms that state the amount is to be paid to the company in September.

    In September when the company receives the $2,000 from the customer, which account should the company credit?
    Accounts Receivable
  24. Expenses are always Debited or credited?
    Debited
  25. Revenues are always Debited or Credited
    Credited

    Revenues have the effect of increasing owners equity so it is almost always credited.
  26. Generally when an expense is involved in a transaction, an expense will be
    Debited

    Expenses almost always Debited except in closing entries, correcting or adjusting entries.
  27. Generally when revenues are involved in a transaction, a revenue account will be
    Credited
  28. The accountant's word to indicate that an entry will be recorded on the left-side of an account is
    Debit
  29. The accountant's word to indicate that an entry will be recorded on the rightt-side of an account is
    Credit
  30. A contra-asset account such as Accumulated Depreciation will likely have which balance?
    Credit

    Since Asset accounts will likely have a debit balance a contra account will have the opposite.
  31. A contra-liability account such as Discount on Notes Payable will likely have which balance?
    Debit

    Since liability accounts have a credit balance.  Contra-liability accounts will have the opposite effect of having a Debit Balance

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